Alberta Business Beat June, 2018 Volume 22 · 2019. 10. 24. · 6 Key Insights ATB Business &...

Alberta Business BeatVolume 22 June, 2018

ATB Business & Agriculture

Background and Methodology

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Background• ATB Financial commissioned NRG Research Group to conduct a survey of 300

randomly selected small- to medium-sized businesses in Alberta each quarter, beginning in Q1 2013. Starting in Q1 2015, the Q1 waves of the Business Beat were conducted as part of the Alberta Business Survey, which increased the number of Q1 survey completes to 600.

• The purpose of the study is to gain an understanding of the challenges faced by small- to medium-sized businesses in Alberta, and to track confidence in the business climate in Alberta.

ATB Business & Agriculture

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Research Objectives

• Measure business owners and managers’ perceptions of what the business climate will be like six months from now;

• Understand how SMEs were impacted by the recent economic downturn, how they are recovering from the economic downturn, business growth plans in the wake of the economic downturn, and biggest barriers preventing growth and/or thriving, and,

• Profile the firmographics as well as respondent demographics for small- to medium-sized businesses in Alberta.

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Methodology

ATB Business & Agriculture

Qualifying Businesses<500 employees,

<$20 million annual revenues,

must be financial decision makers or

influencers•Excluded agriculture, government, financial

institutions, media, market research, PR,

advertising and communications sectors

Field dates:May 16–June 5, 2018

• Telephone with online option

• Approximately 14,000 businesses contacts

made and 300 completed the survey

• Margin of error is +/- 5.8%

Alberta SMEs

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Key Insights

ATB Business & Agriculture

1 The ATB Business Beat Indices dropped in Q2 as SMEs reported feeling less optimistic about the future of their own businesses and less optimistic about the future of the Alberta Economy.

2 Nearly one-third (31%) of businesses surveyed report that they’ve had to pass on a business opportunity because they lacked the necessary staffing levels required to pursue it.

3 Business owners and managers who oversee employees generally perceive millennials (i.e., those younger than 35) to present more of a human resources challenge than older workers.

The ATB Business Beat Indexes

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SMEs remain optimistic about the future

ATB Business & Agriculture

Alberta Economy

68%will be better off or the

same

Your Company

79%will be better off or the

same

“How do you think… will be six months from now?”

(±) Change from last quarter

-11-13

Source: ATB Financial, Survey on Alberta SMEs, June 2018, n = 300.

% better off % the same % worse

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The ATB Business Beat Index

ATB Business & Agriculture

Source: ATB Financial, Survey on Alberta SMEs 2013-18.

Index (0-100)

Data time periods: Q3 2014 = Aug, 2014; Q4 2014 = Dec 2014; Q1 2015 = March 2015; Q2 2015 = June 2015; Q3 2015 = August 2015; Q4 2015 = November, 2015; Q1 2016 = March 2016; Q2 2016 = June 2016; Q3 2016 = September 2016; Q4 2016 = November 2016; Q1 2017 = March 2017 , Q2 2017 = May 2017, Q3 2017 = Aug 2017; Q4 2017 = November 2017; Q1 2018 = March 2018; Q2 2018 - June 2018

More optimistic about future performance

Less optimistic about future performance

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Source: ATB Financial, Survey on Alberta SMEs 2013-18.

Index (0-100)

Data time periods: Q3 2014 = Aug, 2014; Q4 2014 = Dec 2014; Q1 2015 = March 2015; Q2 2015 = June 2015; Q3 2015 = August 2015; Q4 2015 = November, 2015; Q1 2016 = March 2016; Q2 2016 = June 2016; Q3 2016 = September 2016; Q4 2016 = November 2016; Q1 2017 = March 2017 , Q2 2017 = May 2017, Q3 2017 = Aug 2017; Q4 2017 = November 2017; Q1 2018 = March 2018; Q2 2018 - June 2018

More optimistic about future performance

Less optimistic about future performance

The ATB Business Beat Index - Energy

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Source: ATB Financial, Survey on Alberta SMEs 2013-18.

Index (0-100)

Data time periods: Q3 2014 = Aug, 2014; Q4 2014 = Dec 2014; Q1 2015 = March 2015; Q2 2015 = June 2015; Q3 2015 = August 2015; Q4 2015 = November, 2015; Q1 2016 = March 2016; Q2 2016 = June 2016; Q3 2016 = September 2016; Q4 2016 = November 2016; Q1 2017 = March 2017 , Q2 2017 = May 2017, Q3 2017 = Aug 2017; Q4 2017 = November 2017; Q1 2018 = March 2018; Q2 2018 - June 2018

More optimistic about future performance

Less optimistic about future performance

The ATB Business Beat Index - Retail

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Source: ATB Financial, Survey on Alberta SMEs 2013-18.

Index (0-100)

Data time periods: Q3 2014 = Aug, 2014; Q4 2014 = Dec 2014; Q1 2015 = March 2015; Q2 2015 = June 2015; Q3 2015 = August 2015; Q4 2015 = November, 2015; Q1 2016 = March 2016; Q2 2016 = June 2016; Q3 2016 = September 2016; Q4 2016 = November 2016; Q1 2017 = March 2017 , Q2 2017 = May 2017, Q3 2017 = Aug 2017; Q4 2017 = November 2017; Q1 2018 = March 2018; Q2 2018 - June 2018

More optimistic about future performance

Less optimistic about future performance

The ATB Business Beat Index - Construction

Recruiting/ Human Resources

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14Source: ATB Financial, Survey on Alberta SMEs, June 2018, n = 300.

ATB Business & Agriculture

“Over the next six months, does your business plan to...”

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“Has your business ever had to pass on a business opportunity because it lacked the necessary staffing level to pursue it?”

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Source: ATB Financial, Survey on Alberta SMEs, June 2018, n = 300.

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“What would you say is the main reason your business has not hired any additional staff?”

Source: ATB Financial, Survey on Alberta SMEs, June 2018, SOHO businesses, n = 37, Responses of 4% or higher shown

“THE ECONOMY IS NOT MOVING RIGHT NOW AND WITH THIS ECONOMY, PEOPLE ARE JUST NOT MOVING OR MAKING ANY DECISIONS.”

“I DON'T HAVE ANY WORK.”

“NO EXTRA MONEY, HIGH OVER HEAD BECAUSE OF MOVING AND EXPANDING.”

Owner/Operator, Real Estate, 7 years in business, No employees, $250,000 to less than $500,000 annual revenue.

Owner/Operator, Utilities, 6 years in business, No employees, Less than $250,000 in annual revenue.

Owner/Operator, Retail Trade, 18 years in business, No employees, Less than $250,000 in annual revenue.

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“Has your business ever hired contractors to take on tasks you did not have the staffing level

or expertise to fulfill?”

Source: ATB Financial, Survey on Alberta SMEs, June 2018, SOHO businesses, n = 37.

“Which of the following types of tasks has your business hired contractors to take on when you

did not have the staffing level or expertise to fulfill them?”

SOHO businesses that have hired contractors, n=21

Yes

18Source: ATB Financial, Survey on Alberta SMEs, June 2018, SOHO businesses, n = 37.

ATB Business & Agriculture

“If you were to hire someone, what aspect of your business would you have them focus on?”

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“When hiring a new employee, what is THE most important quality your business looks for?”

Source: ATB Financial, Survey on Alberta SMEs, June 2018, Businesses with employees, n = 263, Responses of 3% or higher shown

“CREDENTIALS AND EXPERIENCE IN OUR INDUSTRY.”

Senior Manager or Manager, Professional, Scientific, and Technical Services, 34 years in business, 5-19 employees, $500,000 to less than $1 million annual revenue

Owner/Operator and Vice President, Construction and Manufacturing, 50 years in business, 50-99 employees, $10 million to less than $15 million annual revenue

“RELIABILITY BECAUSE WE ARE IN CONSTRUCTION AND HAVING A CONSISTENT WORKFORCE IS IMPORTANT FOR US.”

CEO or President and Owner/Operator, Food processing/ Distribution, 3 years in business, 1-4 employees, Less than $250,000 annual revenues

“GETTING WORK DOWN, SEE IF THEY QUALIFY TO GET THE WORK DONE.”

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“I’m now going to read you a list of statements pertaining to your experiences hiring new employees. Please let me know whether you agree or disagree with each

statement.”

Source: ATB Financial, Survey on Alberta SMEs, June 2018, Businesses with employees, n = 263.

Strongly/ Somewhat agree

68%

68%

70%

52%

50%

34%

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“For each practice, please let me know whether it is more difficult to manage when dealing with millennials (that is, those aged 35 and younger), older generations

(that is, those older than 35), or if difficulty level is relatively equal across all generations.”

Source: ATB Financial, Survey on Alberta SMEs, June 2018, Businesses with employees, n = 263.

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“Does your business have a formal retention plan or engagement strategy for your

employees?”

Source: ATB Financial, Survey on Alberta SMEs, June 2018, Businesses with employees, n = 263.

“Are any of the following a part of your business’ employee engagement or retention strategy?”

Businesses with employees who have a formal retention plan, n = 102.

Yes

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“Do you offer your employees a defined career path within your business?”

Source: ATB Financial, Survey on Alberta SMEs, June 2018, Businesses with employees, n = 263.

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“If you had to give one piece of advice to another business owner to help them improve their business’ human resource management, what would it be?”

Source: ATB Financial, Survey on Alberta SMEs, June 2018, Businesses with employees, n = 263, Responses of 4% or higher shown

“KEEP COMMUNICATIONS WITH EMPLOYEES OPEN AND EFFECTIVE.”

Owner/Operator, Home Improvement Services, 10 years in business, 1 – 4 employees, $250,000 to less than $500,000 annual revenue.

“I AM A CONTRACTOR AND I AM MORE OR LESS A SEASONAL TYPE GUY. HIRE PEOPLE WITH EXPERIENCE. YOU NEED QUALIFIED TRADESPEOPLE. YOU CAN’T HAVE INEXPERIENCED PEOPLE DOING WORK THEY DON'T KNOW HOW TO DO.”

Owner/Operator, Construction and Energy or Oil & Gas, 20 years in business, 5 – 19 employees, $250,000 to less than $500,000 annual revenue.

“TREAT YOUR EMPLOYEES AS YOU WOULD LIKE TO BE TREATED IF YOU WERE IN THEIR POSITION.”

Owner/Operator, Retail Trade, 17 years in business, 1 – 4 employees, $1 million to less than $3 million annual revenue

APPENDIX: Firmographics & Respondent Demographics

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Number of Employees Annual Revenues

ATB Business & Agriculture

Source: ATB Financial, Survey on Alberta SMEs, June 2018, n = 300.

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Borrowing Needs # of Years in Operation

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Source: ATB Financial, Survey on Alberta SMEs, June 2018, n = 300.

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Industry

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Non-Franchise (n = 277)Franchise Industry n = 23

Retail 11

Food Services 3

Automotive 2

Home Improvement Services 2

Travel, Leisure, & Accommodation

1

Energy/Oil & Gas Services 1

Financial Services/Insurance 1

Real Estate 1

Other 1

Source: ATB Financial, Survey on Alberta SMEs, June 2018, n = 300. * Results of 3% or less are not shown.

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Business Life Stage Phase

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Entrepreneur

Source: ATB Financial, Survey on Alberta SMEs, June 2018, n = 300.

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Family Business

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Majority Woman-Owned

Source: ATB Financial, Survey on Alberta SMEs, June 2018, n = 300.

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Title/ Role Age

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Source: ATB Financial, Survey on Alberta SMEs, June 2018, n = 300. * Results of 2% or less are not shown.

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Role in Financial Decisions

Gender

Source: ATB Financial, Survey on Alberta SMEs, June 2018, n = 300.

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Store Front

Source: ATB Financial, Survey on Alberta SMEs, June 2018, n = 300.

Judy DuncanManaging Director MarketingB&Ag Marketing(403) 974-6884JDuncan@atb.com

Cody TousignantSenior Research ManagerThe Listening Post(403) 305-1073CTousignant@atb.com